22nd March - Weekly FX Update

GBPEUR

Monday 9AM 22nd March: 1.16499

The GBPEUR rate saw increased strength in Sterling heading into Friday. Fluctuations around the 1.17 barrier meant the exchange rate reached a new 12-month high three times last week, eventually hitting 1.17127 early Friday morning, and losing some of those gains over the weekend. The BoE kept interest rates at 0.1%, while resisting further stimulus measures. UK data will dominate the first half of this week, with employment data and inflation numbers being released. After the rate failed to hold above 1.17, and rising tension between the UK and EU over the AstraZeneca vaccine supply, there is a risk of a correction. The GBPEUR has support at 1.15.

GBPUSD

Monday 9AM 22nd March: 1.38657

Despite the UK vaccination programme continuing to outperform itself, the GBPUSD rate declined heading into the weekend, following the pair almost breaking 1.40, peaking at 1.39988 early on Thursday morning. Soaring American yields and an increased demand for the U.S. currency has increased the strength of the dollar, and the pair is looking a little bearish heading into this week, although the Pound has a chance to hold resistance. Jerome Powell, chairman of the Fed, is expected to underpin his message of support today and dismiss any inflation concerns.